Mumbai: To get over the laggard that Netflix is facing in India, the streaming platform is eager to tap into the southern Indian film industry, which is doing extremely well of late, according to a media report. The US company has greenlighted at least six TV shows in southern Indian languages this year, aggressively chasing deals in Tollywood as the Telugu film and TV industry is known, as well as in the Tamil film and TV industry, news agency Reuters reported quoting six people with knowledge of the company’s plans.
Netflix has a range of Indian films across various regions to showcase but for TV series – key to keeping viewers loyal to its platform – it only has a few hit shows in Hindi and no TV shows at all in regional languages. South Indian film industry, which is as prolific as Hindi-language Bollywood, has been dominating India’s box office revenue so far this year with its flashy, action-packed content.
Netflix has “had meetings with pretty much every producer and filmmaker here. You will see the results of those meetings by next year,” Reuters reported quoting one of the people, a Tollywood producer, as saying.
India, a key market for Netflix
Netflix has long positioned India, with its population of 1.4 billion, as a key market. In 2018, two years after it launched in the country, CEO Reed Hastings predicted its next 100 million subscribers would come from India. But so far it has just 5-6 million, according to analysts’ estimates.
In India, Netflix outperforms rivals in terms of the revenue share of the subscription video-on-demand market, commanding a 39 per cent share in 2021 compared to nearest rival Disney Plus Hotstar’s 23 per cent, according to Media Partners Asia. However, as per reports, the streamer’s subscriber base is too small for comfort.
Next to Netflix’s 5-6 million, Disney Plus Hotstar, which owns cricket streaming rights, has about 50 million. Another local rival Zee5 has an estimated 20 million and analysts also gauge Amazon Prime and SonyLIV’s subscriber figures to be well above Netflix’s numbers, according to a Reuters report.
By Hastings’s own admission, Netflix has been frustrated by its lack of success in India relative to its other markets. This new push south also comes at a time when the search for growth has taken on new urgency. The streaming giant stunned investors last month when it reported a quarterly net loss of subscribers globally for the first time in more than a decade, and predicted deeper losses ahead. Its stock has lost almost half its value since then. read more
According to Julia Alexander, director of the strategy at US-based Parrot Analytics, India’s market potential “can’t be understated.”
“If Netflix doesn’t try to capitalize on it by creating stronger relationships with local creatives, local studios/production companies, and carving out a real place for itself in India, someone else will,” she told the agency.
Asked by Reuters about criticism of its performance in India and its push into regional languages, Netflix said in a statement it was confident of what it called a “long-term winning strategy in India”.
“India continues to represent a tremendous opportunity for Netflix to invest and grow, both in terms of membership and the variety of content we offer to our members,” it said.
Netflix’s pricing reason for streamer’s worry
A large part of Netflix’s woes has been its much higher pricing in an extremely cost-conscious market. It slashed fees late last year, making it more competitive but remains much pricier than rivals. However, at Rs 649 per month for its highest quality streaming resolution plan its charges are much higher than its rivals. Disney offers a similar plan at Rs 299 rupees. Netflix’s mobile-only plan for one device is 149 rupees for one month, while Disney charges the same amount for three months.
As per analysts, Netflix’s brand as a premium service may make it reluctant to cut prices further, but then its best, if not only, path, to significant subscriber growth, is expanding its slate of TV shows.
Even with new southern Indian shows added to its pipeline, Netflix still lags behind rivals. Amazon last month announced 22 new original TV shows, eight of them in Tamil or Telugu.
“Netflix is behind compared to Amazon, Hotstar and SonyLIV because it is still in the commissioning stage, whereas the others already have shows out or on the verge of release,” Reuters quoted a producer who said he was in talks with Netflix.
